The Federal Trade Commission is proposing a new rule that would prevent employers from imposing noncompete clauses for workers that prohibit them from joining a competitor, typically for a period of time, after they leave the company.
The proposed rule released Thursday follows an executive order signed by President Joe Biden in 2021 targeting what he labeled anticompetitive practices in tech, health care and other parts of the economy. The order included a call for banning or limiting noncompete agreements to help boost wages.
